The European Bank for Reconstruction and Development (EBRD) and the European Union have committed new investments in hydropower to support Serbia in the quest to improve green energy transition. The two partners are financing a renovation project at the Vlasinske hydropower cascade, a strategic move toward further modernization of the country’s energy infrastructure, with increased utilization of renewable sources in its general energy mix.

The EBRD is going to extend up to €67 million financing to EPS to reconstruct the Vlasinske hydropower cascade. Additionally, the EU will contribute to the investment by providing an amount of €15.4 million through the Western Balkans Investment Framework (WBIF). Thus, this joint effort by these institutions portrays their interest in Serbia’s transition towards a cleaner energy future.

Revitalization of Serbia’s oldest hydropower system

Originally built in 1946, the Vlasinske cascade is one of the oldest hydropower plants in Serbia. The project will extend the plant’s life and boost its capacity by 8 MW, bringing the total to 137 MW. The facility will help Serbia reach its energy demands while going towards cleaner energy sources.

Also read: EBRD Partners with Mongolia to Accelerate Renewable Energy Transition at Davos

Strengthening Serbia’s Energy Security and Sustainability

Matteo Colangeli, the EBRD’s Regional Head of the Western Balkans, said, “We are pleased to be financing the reconstruction of the Vlasinske hydropower cascade, an important project for Serbia’s energy security, and increasing renewables’ share of its generation mix, including by enabling greater integration of intermittent sources like wind and solar.”

He added, “Serbia is making progress on its green energy transition, which is crucial to maintaining economic competitiveness and raising environmental standards. The EBRD is committed to continuing to support this journey through more investments, technical assistance and policy advice.”

Transitioning to Clean Energy

The Vlasinske hydropower project plays a key role in Serbia’s shift from coal to cleaner energy and meeting EU standards. Through this investment, Serbia is modernizing its infrastructure and creating a path for future renewable energy projects.

Chestnut Carbon stated it has signed a new long-term offtake agreement with Microsoft for the delivery of high-quality nature-based carbon removal credits to be generated as carbon removal from Chestnut’s ARR project in the Southern United States, covering Arkansas, Texas, and Louisiana. The new offtake agreement follows the signing of the initial offtake agreement between the two companies December 2023.

This is one of the most significant nature-based and engineered carbon removal projects in the US, Chestnut has signed a deal to supply Microsoft with over 7 million tons of carbon removal credits over the next 25 years. Beyond this, the project will also see restoration of approximately 60,000 acres of land through planting more than 35 million native trees.

Scaling Up Carbon Removal Efforts

Brian Marrs, Senior Director of Energy & Carbon Removal at Microsoft, said, “This agreement with Chestnut Carbon is another positive step towards Microsoft’s goal to become carbon negative by 2030. We look forward to the prospect of scaling forest restoration within the United States, attracting sophisticated private capital in the process. We are glad to see the Sustainable Restoration Project diversify the ecological impact of our global carbon removal portfolio.”

With this latest deal, Chestnut will significantly scale its carbon removal portfolio. By 2030, Chestnut plans to expand its ARR portfolio to 500,000 acres, removing 100 million tons of CO2.

The Chestnut Sustainable Restoration Project

The Chestnut Sustainable Restoration Project stands out for its focus on creating long-lasting ecosystems of native forests at scale. Unlike other projects, it focuses on planting biodiverse hardwood and softwood trees, offering a broad range of environmental benefits. Microsoft’s new agreement with Chestnut directly supports the continued growth of this initiative.

Chestnut’s Sustainable Restoration Project stands out for several key features that ensure its effectiveness and long-term impact. The project, registered with the Gold Standard, issues high-quality carbon removal credits based on actual carbon sequestration, not avoidance. Chestnut ensures long-term durability by conserving land, planting biodiverse species, and implementing risk mitigation practices to sustain carbon storage.

Also read: Microsoft Expands Carbon Removal Partnership with re.green

The project restores marginal agricultural land to native forests, creating value that wouldn’t exist without the global carbon credit market.

Beyond carbon removal, the project provides significant environmental benefits, including enhancing native wildlife habitats, improving air and water quality, and supporting economic development through community engagement and alternative land use strategies.